CAPE TOWN – One of the most traded commodities in the world, which has been very lucrative, came into being after it was discovered by a goat herder.
Kaldi, a goat herder from Ethiopia, noticed his goats “dancing” after eating bright red berries off a certain bush. He took the berries to an Islamic monk in a nearby Sufi monastery who disapproved of the berries and threw them into the fire, from which an enticing aroma billowed and coffee was born. The name coffee came from the region in which the berries were discovered, Kaffa.
Ethiopia, formerly Abyssinia, is a country in East Africa with the fastest growing economy in the world, and the only country in Africa that has never been formally colonised. It is also the second most populous country in Africa, with an estimated population of 109 million people (2018).
With a population that big it is characterised by dozens of ethnic groups with competing claims to land, resources and influence. Ethiopia’s Prime Minister Abiy Ahmedc has struggled to contain ethnic clashes.
In 2018, nearly 3 million Ethiopians were displaced by conflict, the highest figure recorded worldwide, with Islamist militant groups al-Shabaab and Islamic State planning attacks on the country recently.
Emperor Haile Selassie, the former king of Ethiopia asserted that the people of Africa should join forces and form a singular race. This prompted the introduction of Pan Africanism. This idea emerged to become what is known as the African Union today, headquartered in Ethiopia’s capital, Addis Abba.
Ethiopia’s economy experienced strong, broad-based growth averaging 10.3 percent a year from 2006/07 to 2016/17 (African Development Bank 2017), compared to a regional average of 5.4 percent.
Bordered by six countries, Ethiopia’s location gives it strategic dominance on the Horn of Africa, close to the Middle East and its markets.
Ethiopia’s main challenges are sustaining its positive economic growth and accelerating poverty reduction, which require significant progress in job creation as well as improved governance.
Despite the economic growth, only 60 percent of the population have access to electricity; 65.7 percent of households have access to potable water; and the paved-road density is among the lowest in Sub-Saharan Africa. Economic growth has not translated into human development or improvement in the quality of life, as poverty is still high.
The country’s leading exports are coffee, oil seeds and pulses, while manufacturing accounts for less than 10 percent of gross domestic product (GDP). The estimated GDP of the country was at $83 billion (R1.2 trillion) (2018). The country aims to grow this by exporting its hydro-power to Kenya and Djibouti.
Ethiopia is tackling the lack of structural transformation with its five-year growth and structural transformation plan II.
On the Neil economic scale, the price of a can of Coke costs 11.17 birr (R5.69) and the price of a litre of petrol is 21.46 birr (R10.93). Inflation in the country is expected to be around 19.1 percent at the end of the third quarter.
Ethiopia’s leadership is moving forward in trying to stabilise and reduce conflict in the country that can be seen in the era of peace and friendship, after Eritrea and Ethiopia signed a peace deal at a bilateral summit last year.
The country seeks to close its infrastructure gap, pursue regional integration, and support improvements in agriculture, basic services, and the business environment.
Neil de Beer is president of the IFA and advises numerous African states on economic development; www.ifa.africa or [email protected]